Scotiabank has emerged as the latest Canadian bank to exit the UN-brokered climate finance alliance, following the exit of four other Canadian banks last week.
The bank’s departure from the Net-Zero Banking Alliance (NZBA) comes in the wake of the Toronto-Dominion Bank (TD), Bank of Montreal (BMO), Canadian Imperial Bank of Commerce (CIBC), and National Bank of Canada leaving the alliance Jan. 17.
The recent exits of Canadian banks from the alliance follow the withdrawal of the six largest banks in the United States in the weeks leading up to the Jan. 20 presidential inauguration of Donald Trump.
Some U.S. Republican politicians have been critical of the alliance, with Rep. Andy Barr saying the alliance is meant to “weaponize the financial system and politicize it to choke off funding to legal fossil energy businesses.”
The United Nations says the purpose of the pact is to “help develop sustainable economies and to empower people to build better futures.”
The Epoch Times contacted Scotiabank for comment on its decision to leave the alliance but did not receive a response prior to publication.
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The Royal Bank of Canada is the last of the country’s six major banks to remain in the alliance.
RBC president and CEO Dave McKay was asked about membership in the alliance earlier this month at the RBC Capital Markets Canadian Bank CEO Conference. He did not directly address if RBC had plans to leave the alliance but, instead, talked in hypotheticals.
“Pulling out of NZBA, hypothetically, doesn’t lead to non-commitment to net zero climate change,” McKay said during the Jan. 7 speech.
“It just means that mechanism, that organization that fostered oversight and policies and rules around what you can and can’t do and how you report, maybe that is not the right mechanism to do it.”
BMO chief executive Darryl White told the same conference his bank planned to leave the alliance. It was the first major Canadian bank to exit NZBA.
BMO released a statement Jan. 17 saying it remained “fully committed to our climate strategy and supporting our clients as their lead partner in the transition to a net zero world.” The bank said it still had “robust internal capabilities to implement relevant international standards” to support its climate change strategy.
CIBC said the alliance was established during a period when the global sector was intensifying its climate initiatives, but the landscape has progressed sufficiently for the institution to pursue its objectives independently.
TD said it now has the necessary resources to further its own strategy and advise its clients as they adapt their businesses.
The National Bank indicated it has withdrawn from the alliance as it streamlines its reporting processes. The bank said it planned to adopt a pragmatic approach and work with businesses in all sectors to promote decarbonization.
NZBA Roots
NZBA was established in April 2021 with the aim of motivating banks to contribute to initiatives aimed at achieving net-zero emissions. Canada’s six largest banks joined that October.
“Joining NZBA reinforces the six banks’ commitment to play a significant role in financing the climate transition and support collaborative approaches between the public and private sectors to reach the goal of net-zero by 2050,” the banks said in a joint statement. “It also represents the advancement of the banks’ shared goals to combat climate change in an inclusive way.”
Backed by Mark Carney, the UN special envoy and current Liberal leadership hopeful, NZBA currently includes 136 banks from 44 different countries as part of its membership.
U.S. banks Goldman Sachs, Wells Fargo, Bank of America, Citi, Morgan Stanley, and JPMorgan all announced their exit from NZBA after Trump won the U.S. election on Nov. 5.
Carney told the Daily Show’s Jon Stewart last week that the U.S. banks would likely change their tune after the next presidential election.
The Canadian Press and Matthew Horwood contributed to this report.
